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Chapter 5.

7: Labour and Labour Welfare


Labour sector addresses multi-dimensional socio-economic aspects affecting

labour welfare, productivity, living standards of labour force and social security. To raise
living standards of the work force and achieve higher productivity, skill upgradation through
suitable training is of utmost importance. Manpower development to provide adequate
labour force of appropriate skills and quality to different sectors is essential for rapid socio-
economic development. Employment generation in all the productive sectors is one of the
basic objectives. In this context, efforts are being made for providing the environment for
self-employment both in urban and rural areas. During the Ninth Plan period, elimination of
undesirable practices such as child labour, bonded labour, and aspects such as ensuring
workers’ safety and social security, looking after labour welfare and providing of the
necessary support measures for sorting out problems relating to employment of both men and
women workers in different sectors has received priority attention.


2. Various plan schemes of the Ministry of Labour aim at achievement of welfare

and social security of the working class and maintenance of industrial peace. As against the
approved outlay of Rs.130 crore for the year 1999-2000, the anticipated expenditure would
be Rs.104 crore. The approved outlay for the year 2000-2001 is Rs.123 crore. (Refer
Annexure 5.7.1 for Central Sector and Annexure 5.7.2 for State sector).

3. Plan initiatives in the Labour & Labour Welfare Sector are as under:

(i) Training for skill development.

(ii) Services to job seekers.
(iii)Welfare of labour.
(iv) Administration of labour regulations.

4. Under the Constitution of India, Vocational Training is a concurrent subject. The

development of training schemes at National level, evolution of policy, laying of training
standards, procedures, conducting of examinations, certification, etc. are the responsibility of
the Central Government, where as the implementation of the training schemes largely rests
with the State/U.T. governments. The Central Government is advised by the National
Council of Vocational Training (NCVT), a tripartite body which has representation from
employers, workers and Central/State governments. At the State level, similar councils
known as State Councils for Vocational Training are constituted for the same purpose by the
respective state governments at state levels.

5. The main objectives of the scheme are as under:

(i) To ensure steady flow of skilled workers.

(ii) To raise the quality and quantity of industrial production by systematic
training of potential workers.
(iii)To reduce unemployment among educated youth by equipping them with
suitable skills for industrial employment.

Chapter 5.7: Labour and Labour Welfare

6. The main Vocational Training Schemes comprise of Craftsmen Training Scheme,

Apprenticeship Training Scheme, Training of skilled workers, training of women as a special
target group, Training of Craft Instructors, Training of Supervisors and also to carry out
applied research on vocational training problems while paying adequate attention towards
preparation and development of instructional material.

7. The Craftsmen Training Scheme and Apprenticeship Training Scheme which are
adequately dovetailed and meant to bring maximum benefit to the youth in their formative
years, form the centre stage of the vocational training schemes. A number of other
departments have also started training activities for their respective sectors e.g. Small
Industry, KVIC, handlooms, tourism (hotel management & catering), electronics, medical
technicians, agriculture and rural development. These training schemes are smaller but serve
a very useful and essential purpose in the overall sphere of vocational training. In spite of
difficulties and shortcomings, the Vocational Training Schemes have continued to make
progress especially in terms of being the primary source of manpower for the industry.

8. The Central Government mainly concentrates on laying down the policies,

procedures and training standards while the management of ITIs are under the concerned
State Government(s)/U.Ts. In this process, the Central Government is advised by two
tripartite advisory bodies namely, the National Council for Vocational Training (NCVT) and
the Central Apprenticeship Council (CAC). Both the Councils have the Union Labour
Minister as the Chairman. Annual meeting of the two bodies was held in the month of July,
1999. In the meeting the steps to improve the quality of training both under NCVT and CAC
were discussed and concrete recommendations emerged. The following are the important

• Setting up an Expert group to look into the issues relating to Vocational

Training Programme for persons with disability (equal opportunities under the
persons with Disability Act, 1995) and its implementation under CTS.
• Introduction of four new trades viz. Computer Hardware, Medical Electronics,
Consumer Electronics and Industrial Electronics under CTS.
• Revision of space norms for workshops.
• Introduction of modular training for advanced skill courses for women at


9. The Craftsmen Training Scheme (CTS) under the National Vocational Training
System was introduced in 1950 for imparting skill training. Training is imparted mainly in
engineering trades. A few trades outside the engineering field are also covered but the bulk
of the services sector and need of industries other than manufacturing are not handled by
DGE&T. In the area of training, six new trades (in the areas of Information Technology,
Electronics) in Craftsmen Training Scheme in different ITIs and nine new trades under
Apprenticeship Training Scheme have been introduced.

10. There has been a significant growth and expansion in the network of ITIs which
have grown to 4172 in the Public and Private sectors with a seating capacity of 6.78 lakh as
on 31.12.99 (State-wise details presented in Annexure 5.7.3) and another 2.33 lakh under the
Trade Apprentice Scheme. The Apprenticeship Training Scheme provides practical training
Chapter 5.7: Labour and Labour Welfare

in 137 designated trades to train apprentices in 101 subject fields in engineering and
technology for graduates and diploma holders and 94 subject fields for technicians. Details
of Region wise utilisation in respect of Trade Apprentices in the Central Sector and State
Sectors as on 30.6.99 are given in Annexures 5.7.4 & 5.7.5.

11. Directorate General of Employment and Training, through its women’s

occupational Training Directorate, launched the women’s Vocational Training Programme in
1977. The programme aimed at providing Vocational Training facilities to women, thereby
increasing their employability and consequently their participation in the economy of the
country. Under the Vocational Training Programme at Central Sector, training facilities for
women in Vocational Skills are being provided through a network of Women's Vocational
Training Institutes.

12. The Government has initiated steps for strengthening and modernisation of
Industrial Training Institutes (ITIs) in Jammu & Kashmir. All trades that have demand and
local relevance will be covered by including even such activities that are presently outside
NCVT approved trades such as construction, carpet weaving, horticulture, catering, tourism,

13. The existing training institutions have, no doubt, been meeting a significant part of
the requirements of the skilled manpower of the organised industry. It, however, seems
necessary that the process of restructuring and reorientation of their courses is expedited with
a view to quickly responding to the labour market. For skill upgradation of the workers in
the unorganised sector, flexibility in the duration, training and location of training courses
would need to be introduced. To the extent a sizeable proportion of employment would have
to be self employment in tiny and small units in various sectors, the training system should
also gear up not only for providing hard skills for suitable trades, but also the soft skills of
entrepreneurship, management and marketing, as part of training courses.

14. In order to improve accessibility to employment to trainees from ITIs, there is

need to take up a new market driven trades and dispense with the traditional trades such as
blacksmith, carpentry, conventional tailoring etc. Since the ITIs are being run by the States,
the State Governments have been advised to network with the industry and bring changes in
their syllabus/trades of ITIs. In this direction, some of the States have already taken steps, for
example, the State Government of Haryana is opening up an ITI in Gurgaon in collaboration
with Confederation of Indian Industry. The trades/syllabus are being decided in consultation
with the CII keeping in view the future demands of the industry. The financial burden will
also be shared by the industry. The Government of Gujarat has also started networking with
the industry in the change over of obsolete trades to make them market driven.


15. National Employment Service covers all the States and Union Territories except
Sikkim, and functions within the framework of the Employment Exchanges (compulsory
notification of vacancies) Act 1959. Day to Day administration of the Employment
Exchanges is with the State/U.T. governments. It has a network of 953 Employment
Exchanges as on 30.6.99. Year-wise registration, placement, vacancies notified, submission
made and live register for the period 1989 to 1998 may be seen in Annexure 5.7.6. The main
activities of the Employment Exchanges are registration, placement of job seekers, career
Chapter 5.7: Labour and Labour Welfare

counselling, vocational guidance and collection of labour market information. Special self
employment promotion cells (SEPCs) have been established in 23 selected Employment
Exchanges up to the end of December, 1998, 0.7 lakh persons have been placed in self
employment and 1.8 lakh persons were on the live register of these cells seeking self
employment assistance.

16. National Employment Service in the context of newly emerging market scenario
has to be reoriented. The Employment Services has now accepted its enhanced role and is
paying greater attention to compilation and dissemination of comprehensive labour market
information. The important reports generated by the Employment Market Information
Programme are “The Quarterly Employment Review”, “Occupational and Educational
Pattern in India”, etc. There are also plan schemes for modernisation and computerisation of
employment exchanges for strengthening of Employment Market information programme.

17. The Employment service continued to pay special attention to the needs of the
weaker section of society. A comprehensive package of services is provided to the
handicapped by 17 vocational rehabilitation centres for the handicapped. Out of these, the
Vocational Rehabilitation Centre at Vadodara has been set up exclusively for disabled
women. These centres evaluate the residual capacities of the handicapped and provide them
adjustment training, facilitating their early economic rehabilitation. Efforts are also made to
assist them in obtaining other suitable rehabilitation services such as job placement and
training for self-employment. Setting up of seven new Vocational Rehabilitation Centres
(VRCS), 12 skill Training workshops in the Vocational Rehabilitation Centres and 26 Rural
Rehabilitation Extension Centres is under consideration of the Ministry of Labour.
Vocational guidance and training in confidence building is provided to job seekers belonging
to the scheduled castes and the scheduled tribes at 22 coaching-cum-guidance centres. In
addition, the scheme to provide facilities to SCs/STs job seekers for practicing shorthand and
typing is in operation in Coaching-cum-guidance (CGCs).


18. The improvement of labour welfare and increasing productivity with reasonable
level of social security is one of the prime objectives concerning social and economic policy
of the Government. The resources have been directed through the Plan programmes towards
skill formation and development, monitoring of working conditions, creation of industrial
harmony through infrastructure for health, industrial relations and insurance against disease,
accident and unemployment for the workers and then families. The situation of surplus
labour and workers in the unorganised segment of the economy give rise to unhealthy social
practices such as bonded labour, child labour and adverse working conditions.

19. In the year 1999, Workmen Compensation Act has been revised to benefit the
workers and their families in the case of death/disability. The labour laws enforcement
machinery in the States and at the Centre are working to amend the laws which require
changes, revise rules, regulations orders and notifications.


20. The Government has set up the Second National Commission on Labour on 15th
October, 1999. The Commission will suggest rationalisation of the existing laws relating to
Chapter 5.7: Labour and Labour Welfare

labour in the organised sector and also an umbrella legislation for ensuring a minimum level
of protection to the workers in the unorganised sector. The Commission would submit its
report within two years i.e. by 15.10.2001.


21. According to the 1991 Census, the number of working children in the country was
of the order of 11.28 million (State-wise details are available in Annexure 5.7.7). The
existence of child labour in hazardous industries is a great problem in India. Non-availability
of accurate, authentic and up-to-date data on child labour has been major handicap in planned
intervention for eradication of this social evil. Efforts are underway in the Ninth Plan to
modify and improve the existing National Child Labour Project. A major activity undertaken
under this scheme is the establishment of special schools to provide non-formal education,
vocational training, supplementary nutrition, stipends, health care, etc. to children withdrawn
from employment in hazardous industries.

22. During 1999-2000 (till end of January, 2000), 91 National Child Labour Projects
have been sanctioned, in child labour endemic states for rehabilitation of nearly 1.9 lakh
children who were removed from work. State wise coverage under NCLP is as given in
Annexure 5.7.8.

23. A review of the implementation of various programmes for elimination of child

labour reveals that even though a good beginning has been made from 1994-95 onwards, in
order to make a significant dent on this age old social evil a multi-pronged strategy coupled
with a massive mobilisation of resources, both physical and financial, is required.

24. Before considering any expansion of the programme, it was considered

appropriate to get the existing projects evaluated through independent evaluation agencies.
Accordingly, five evaluation agencies were identified for evaluating child labour projects in
the States of Uttar Pradesh, Tamil Nadu, Andhra Pradesh, Orissa and Rajasthan. The reports
received showed, inter alia, that the magnitude of the child labour problem can be
considerably reduced through rehabilitation measures by the projects and that there is need to
continue the component of special schools or camp approach. The need for awareness
generation among the public has also been highlighted.


25. The Centrally sponsored Plan scheme for rehabilitation of bonded labour was
formulated by the Ministry of Labour in 1978. Under the bonded labour system, the
responsibility for identification, release and rehabilitation of free bonded labourers rest
entirely with the State Governments. However, with a view to supplementing the efforts of
the State Governments, a CSS was launched by the Ministry of Labour in 1978-79. The
expenditure is shared equally by the Central and State Governments on 50:50 basis. Under
the scheme, a bonded labour on release is immediately paid Rs.1000 as subsistence allowance
and he/she is rehabilitated as per situation with a rehabilitation package of Rs.10,000 keeping
in view the price escalation and increase in the cost of the rehabilitation package, cost of
buffaloes, cows and other inputs during the last four years, the scheme has been modified
recently by raising the rehabilitation package from the existing amount of Rs.10,000 to
Rs.20,000 per bonded labour and with provision for conducting surveys for identification of
Chapter 5.7: Labour and Labour Welfare

bonded labour, creation of awareness, conducting evaluation studies etc. Planning

Commission has also agreed to provide 100 per cent subsidy to the North Eastern States
keeping in view the financial constraints faced by these States. The modified scheme would
be implemented in the remaining period of the Ninth Plan and a review will be done before
the start of Tenth Plan.

26. Since the inception of the scheme 2,80,411 bonded labour have been identified
and released, out of which 2,51,569 have been rehabilitated by 31.3.2000 and Rs.50.32 crore
have been released to the State Government as Central Assistance up to 31.3.2000. State-
wise break-up of achievement is in Annexure 5.7.9.

27. In order to review the progress and proper monitoring of the Centrally Sponsored
Scheme and other poverty alleviation programmes which are in operation for the purpose of
effective rehabilitation of bonded labourer, it is proposed that monitoring of the schemes may
be done at there levels i.e. National State & District Levels. In this regard, at least two
workshops/monitoring meetings may be organised by the Ministry of Labour at the Central
Level. High Powered committees at district and State levels may be constituted on
permanent basis for monitoring the schemes. The monitoring will help in removing the
shortcomings noticed in the process of their implementation and bringing improvements and
equipping officers with crucial skills needed for identification, release and rehabilitation of
bonded labour with extra care and dedication. This is important so that once a bonded
labourer is released and rehabilitated, he/she does not go back to bondage once again.


28. The Ministry of Labour has set up a Women Labour Cell in 1975. The intention
was to focus attention on the lot of working women with a view to improving it. The
Government has enacted the Equal Remuneration Act, 1976. The Women Cell has been
created in the Ministry to monitor implementation of this Act. A Central Advisory
Committee has been set up to advise the Government on providing increasing employment
opportunities for women. Similarly, State Advisory Committee has been constituted to
monitor the Act at the State level. The Cell also gives grants-in-aid to voluntary
organisations to carry out research studies on problems of women workers, their
employability and the extent of their displacement on account of technological and various
other changes. This scheme was introduced with the intention of furthering Government’s
policy of helping women to become aware of their rights and opportunities and also to
become economically independent.


29. The Constitution of India contains specific provisions for the occupational safety
and health of workers. The Directorate General of Mines Safety (DGMS) and Directorate
General of Factory Advice Service and Labour Institutes (DGFASLI) strive to achieve
occupational safety and health in mines, factories and ports. The schemes relating to
occupational safety concentrate on improvement of work environment, man-machinery
interface, control and prevention of chemical hazards, development of protective gear and
equipment, training in safety measures and development of safety and health information

Chapter 5.7: Labour and Labour Welfare



30. This organisation functions as the technical arm of the Ministry in matters
concerning with safety, health and welfare of workers in factories and ports/docks. Eighty
eight seminars/workshops and longer duration training programmes including the one year
diploma courses in industrial safety and three months PG certificate course in occupational
health have been conducted for over 2055 participants from 772 organisations during January
to September, 1999. Labour Institutes in Mumbai, Kanpur, Calcutta and Chennai conducted
339 appreciation programmes for 7878 beneficiaries on safety, health and welfare. Mobile
safety exhibitions were set up at 43 factories benefiting 36350 factory workers. DGFASLI
completed 45 consultancy studies in the areas of hazardous assessment, environment
assessment, safety audit, assessment of occupational health status at the request of various


31. The Directorate General of Mines Safety which is a subordinate office of the
Ministry of Labour is entrusted with the responsibility of enforcing the provisions of the
Mines Act, 1952. With a view to ensuring enforcement of necessary safety measures in
mines, inspections and enquiries are carried out by the inspecting officers. During the period
April to September, 1999, 17 notices and 5 orders were issued to coal mines and 13 notices
and 26 orders were issued to non-coal mines. The number of inspections and enquiries
carried out during this period were 8179 and 9743 respectively.


32. The Labour Bureau is responsible for collection, compilation and publication of
statistical and other information regarding employment, wages, earnings, industrial relations,
working conditions, etc. It also compiles and publishes the consumer price index numbers
for industrial and agricultural workers. The Bureau further renders necessary assistance to
the States for conducting training programmes in Labour statistics of State/District/Unit
levels. Data compiled for periodic returns do not meet all the information requirements for
planning and policy formulation in the field of labour. With a view to bridge the gap in the
availability of labour statistics, the Bureau conducts several periodic/ad hoc surveys on
different aspects of labour such as:

• New working class Family Income and Expenditure Survey.

• Rural labour Enquiries.
• House Rent Surveys.
• Occupational Wage Surveys.

33. In the Ninth Plan, many initiatives have been taken by the Government for labour
welfare. The Labour Bureau, Shimla has conducted evaluation studies of the Minimum
Wages Act, 1948 to determine the degree of implementation in the various scheduled
employment categories in different parts of the country. The Bureau has also been studying
the working and living conditions of women workers and the extent of the welfare facilities
available to them vis-à-vis the various labour laws in mining, plantation and factory sectors
as well as in selected unorganised industries.
Chapter 5.7: Labour and Labour Welfare


34. The Central Board of Workers Education through its regional offices is striving to
educate the workers to help to avoid wasteful expenditure, adopting cost effectiveness and by
enhancing productivity of qualitative nature. They have been conducting the following

• Rural Awareness Programme.

• Functional Adult Literacy Classes.
• Short-term programmes for the unorganised sector to educate them on their
rights, ethics and hygiene.
• Participative Management.
• Orientation Courses for Rural Educators.
• Leadership Development Programme for Rural Workers.


35. V.V. Giri National Labour Institute, a fully funded autonomous body of the
Ministry of Labour, conducts action-oriented research and provides training to grass root
level workers in the trade union movement, both in the urban and rural areas, and also to
officers dealing with industrial relations, personal management, labour welfare, etc. The
Institute completed the following research projects during 1999-2000:

• Dynamics of Labour Market: Kearla.

• Women and labour Market.
• Labour laws, contractual parameters and conditions of construction workers.
• Adverse sex ratio and female labour force participation.
• Wage determination in rural labour force markets.
• Information on requirements for rural labour.

36. The following study was however of utmost significance

• “ Study on payment of wages wholly in kind and perceptions regarding Mode

of payment: A study in selected States". This Study was undertaken in
pursuance of directions of the Committee of Secretaries at a meeting held on
1.4.99 for the purpose of amendment to the Minimum Wages Act, 1948. The
study was completed in four states, viz. Tamil Nadu, Maharashtra, Bihar and


37. There are also laws enacted and schemes established by the Central/State
Governments providing for social security and welfare of specific categories of working
people. The principal social security laws enacted centrally are the following:

• The Workmen’s Compensation Act, 1923.

• The Employees State Insurance Act, 1948.
Chapter 5.7: Labour and Labour Welfare

• The Employees Provident Funds and Miscellaneous Provisions Act, 1953.

• The Maternity Benefit Act, 1961.
• The Payment of Gratuity Act, 1972.

38. The E.P.F. & M.P. Act is administered exclusively by the Government of India
through the EPFO. The cash benefits under the ESI are administered by the Central
Government through the Employees State Insurance Corporation (ESIC) whereas medical
care under the ESI Act is being administered by the State Governments and Union Territory
Administrations. The Payment of Gratuity Act is administered by the Central Government in
establishments under its control, establishments having branches in more than one State,
major ports, mines, oil fields and the railways and by the State Governments and Union
Territory Administrations in all other cases. In mines and circus industry, the provisions of
the Maternity Benefit Act are being administered by the Central Government through the
Chief Labour Commissioner (Central) and by the State Governments in factories, plantation
and other establishments. The provisions of the Workmen’s compensation Act are being
administered exclusively by State Governments.

39. Employees Pension Scheme, 1995 was amended in February, 1999 to provide for
pension to dependent father/mother in respect of a deceased member, who has no eligible
family members and if no nomination was executed by him during his life time. Permanent
and totally disabled children of the PF members were made entitled w.e.f. February, 1999 to
payment of monthly children/orphan pension irrespective of age and number of children in
the family. Disbursement of pension and provident fund benefits on the date of retirement in
Public Sector Undertaking and model private sector establishment was introduced. One
hundred and thirty six beneficiaries were paid benefits on the date of retirement during the
two months December 1998 and January, 1999. Under the Workmen Compensation Act,
persons employed as cooks in hotels/restaurants made eligible for benefits of compensation
w.e.f. July, 1998.

40. For workers of poor families not covered under any insurance scheme or any law
statute, the Central Government has introduced a scheme of Personal Accident Insurance
Social Security Scheme. The Scheme is applicable to all persons in the age group of 18-55
who are earning members of poor families and meet with fatal accidents. The quantum of
benefits is Rs.3,000. The Scheme is implemented through the General Insurance

41. A new initiative has been taken by the Ministry of Agriculture and Cooperation by
providing insurance cover to unorganised labour working in construction industry, agriculture
fields and forests where the insurance cover will be provided through the Co-operatives on
50:50 basis through the national insurance cover and Labour Co-operatives. A premium of
Rs.5.25 per annum will be paid by the Co-operatives. The insurance cover has the provision
that in the case of death of a labourer, his family will be paid Rs.25,000.